Just quickly..... so ZIM had priority on Coal before Gas...... maybe a good deal between the company and the government.
Invictus will have it's day...... a matter of time.
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Contango Holdings (LSE:CGO) shares soared in Monday’s early deals after it unveiled a new plan that promises to unlock the Muchesu coal project in Zimbabwe.
Thecompany, in a statement, said it had agreed to sell a 51% interest in the project to Wencai Huo, a Zimbabwe-based Chinese investor with experience in the coal mining industry in the region.
Contangoexpects to retain a 24% stake in the project.
Itsinitial agreement with Wencai Huo envisages the investor providing investmentsinto the project (matching an historic spend of $20 million), as well as takinga 20% stake in Contango.
Theinvestor, meanwhile, will also grant to Contango life-of-mine royalties overgross production, with a minimum annual payment of US$2 million.
Subsequently,Contango said it expects to reach future agreements over the mine’s offtake andthe composition of its board.
CarlEsprey, Contango chief executive, described himself as delighted with the termsheet agreed with the investor.
"Muchesuis a world-class coal deposit and we have focused our efforts on unlocking itsvalue while minimizing dilution to shareholders,” Esprey said in thestatement.
"Mr.Huo is highly experienced in mining and operating throughout southern Africa.
“Hisintention to become a major shareholder in Contango, as well as become the leadpartner in the Project, is testament to the upside potential for Contangoshareholders."
Espreyadded: "By investing a further US$20 million at Muchesu we will be able toquickly ramp up operations and secure the larger contracts we have beenreviewing or are aware of.
“Ourintention has always been to develop Muchesu into a significant source ofthermal and coking coal, as well as the manufacture of coke at site.
“Thistransaction will position us to subsequently benefit from this, withoutrequiring the shareholders to be diluted by further capital raises or toreinvest cash flow to fund expansion."
InLondon, Contango shares were up 31% changing hands at 1.28p – and earliertraded as high at 1.68p.
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